Japan International Cooperation Agency (JICA) chief representative in Bangladesh Dr Toda Takao said that more and more private investors in Japan are eagerly looking at Bangladesh to set up new industries, particularly in the manufacturing sector.
Alongside the government’s efforts to receive official development assistance (ODA), he suggested the policymakers in Bangladesh to pursue more foreign direct investment (FDI) that could generate huge employment.
In an exclusive interview with UNB, the JICA country chief said: “We shall not neglect the potential attractiveness of Bangladesh for foreign private sectors. Although there seems to be still modest signs, there will be more and more Japanese private sector actors who are becoming interested in having business with this country. We all know that not only ODA, but also FDI could be effective engines of growth.”
He, however, said that Japanese ODA will be contributing to this country’s investment environment.
Japan has been celebrating 40 years of tie with Bangladesh with more commitment to continue support to different sectors ranging from rural development to urban mega infrastructure projects.
As part of the commitment, the JICA recently signed a highest ODA loan package of 95,683 million Yen (equivalent to US$ 1.03 billion) for four infrastructure projects, which is the largest ever package exceeding earlier ones. The concessionality of the loan is most generous with the interest rate at 0.01 percent per annum and 40-year repayment period with 10-year grace period.
During the last four years, Japan has significantly increased its commitment of assistance to Bangladesh. Only for the current fiscal year, Japan made commitment to provide US$ 1.8 billion financial contribution as well as technical and grassroots supports.
Dr Toda Takao said Japan’s technical cooperation well combined with huge financial support in various sectors such as power and energy, transport, water, waste management, local governance, rural infrastructure, health especially mother and child health, infectious diseases, education especially quality of primary education, disaster management and climate change.
He informed that as for JICA’s grassroots cooperation, so far 1,162 JICA volunteers have touched down on this country, around 80 of whom are working hand-in-hand with the local people and government officials.
Replying to a question on Japan’s recent vigorous interest in a country like Bangladesh which is South Asia’s most densely one having 160 million people, the JICA country chief said this country is one of the most attractive and exciting developing countries in the world especially from “developmental” viewpoint.
According to him, firstly, with its huge potentials, Bangladesh’s population bonus will be one of the world largest and longest one. Secondly, with its enormous challenges, Bangladesh keeps its entitlement of the world’s most fragile state vis-à-vis natural disaster.
“Its population under extreme poverty line stays one of the largest in the world. Its population bonus could turn into a simple population burden if the quality of education and human resource development were not successful. This sharp contrast between its potential and challenges provides the Japanese the legitimate reason to radically increase its assistance in spite of long standing difficulties over Japanese economies.”
Evaluating the development in various sectors in Bangladesh, Dr Toda Takao said everybody should be rather optimistic about Bangladesh’s macro economic performance.
He observed that Bangladesh’s GDP growth stays around the level of 6 percent although there might be some downturn this fiscal year. Probably above 6 percent growth might be seen in the next fiscal year, he said.
The JICA chief representative thought inflation will be maintained at the reasonable level of around 6 to 7 percent while capital inflow will continue to be on track thanks to fairly robust FDI and ODA, to which Japanese ODA is also contributing.
From sector-wise perspective, he said power and energy, urban transport, and urban water and sanitation should continue to be the urgent priority for Bangladesh. “Bold and proactive measures to these sectors could ease the bottleneck of development. Otherwise, with the highest population density, this country’s economy would face enormous difficulties in the very near future.”
Responding to a question on the present political situation in Bangladesh, Dr Toda Takao said: “I am not in a position to make a comment on the political situation. However, from development practitioner’s viewpoints, I dare say that peace and stability shall be the key to sustainable development of this country.”
Regardless of any situation, he said, the government’s service to the people must continue to be provided in a reliable way. People should not suffer from any acts of fraud or corruption. They should be free from any acts of violence.
Asked how Bangladesh could take lessons from Japanese strategy and experience, the development representative of the world’s second largest economy, said firstly, Japan has prioritized human resource development, which could be of same importance in Bangladesh.
Secondly, he said, Japan’s achievement of growth, environment and energy efficiency could be made full use of for Bangladesh to fight against the same pressing problem here.
Thirdly, Japan’s local government system which manages relatively small land in an effective way could also be of interest to Bangladesh.
Fourthly, Japanese way of industrialization, especially her priority to MONOZUKURI (manufacturing) and KAIZEN (Gradual and bottom up improvement) shall be appropriately considered in the process of Bangladesh Industrial Policy making, he added.
Asked about Bangladesh’s risk of lone dependency on readymade garment export for the economy, Dr Toda Takao said he is not pessimistic on this point. “Firstly, the readymade garment export of Bangladesh is not only cheap price oriented but also becoming to be quality oriented which steadily increase its robustness.”
“Secondly, multiplication of industry, although not so rapid, has already started. Taking example of Japanese industries coming into this country, we can see more and more business actors in the variety of sectors,” he said.
Source: UNB Connect